In mammals, bone morphogenetic protein 2 (BMP2) is a critical regulator of endometrial decidualization and early implantation. Insulin-like growth factor-binding protein 3 (IGFBP3) is highly expressed in the endometrium and at the maternal-fetal interface in multiple species, including humans. BMP2-induced IGFBP3 signaling has been confirmed to have a role in trophoblast cell invasion; however, the involvement of this signaling pathway in endometrial remodeling remains poorly understood. To determine the roles of BMP2 in regulating IGFBP3 expression during the transformation of endometrial stromal cells, we employed immortalized human endometrial stromal cells (HESCs) and primary human decidual stromal cells (HDSCs) as study models. We showed that BMP2 significantly increased the expression of IGFBP3 in a dose- and time-dependent manner in both HESCs and primary HDSCs. Additionally, the BMP2-induced upregulation of IGFBP3 is mediated by the inhibitor of DNA-binding 1 (ID1), and knockdown of ALK3 completely abolished BMP2-induced upregulation of ID1. Moreover, BMP2 increased the expression of matrix metalloproteinases 2 (MMP2) and promoted cell migration in HESCs and primary HDSCs. Knockdown of either IGFBP3 or ID1 significantly suppressed the basal and the BMP2-induced increase in MMP2 expression as well as the cell migration in both cell models. These data demonstrated that BMP2 upregulated the expression of ID1, which in turn induced the expression of IGFBP3, and these BMP2-induced cell activities were most likely mediated by the ALK3 type I receptor. The increased expression of IGFBP3 promoted the MMP2 expression and cell migration in both HESCs and HDSCs. These findings deepen our understanding of a newly identified mechanism by which BMP2 and IGFBP3 regulate endometrial remodeling in humans, which provides insight into potential therapies for endometrium-related diseases and pregnancy-induced complications.